"They set themselves up to run a government"

The Islamic State’s staggering $200 million demand for two Japanese hostages may reveal the terrorist group’s desperation to maintain control of its sprawling caliphate, especially amid falling black market oil revenues from seized wells and pipelines, terrorism experts said.

An online video purportedly released by the group’s al-Furqan media arm and posted Tuesday on militant websites associated with the terror network presents a pricey ultimatum: Japan must pay $200 million within 72 hours or two Japanese hostages — a 42-year-old private military company operator and a 47-year-old freelance journalist — will be executed.

The hostages, identified as Haruna Yukawa and Kenji Goto Jogo, appear in the video in orange jumpsuits like other hostages previously killed by Islamic State, which controls a third of Iraq and Syria. The militant who threatens them speaks in a British accent and may be the same jihadist who appeared in videos with western journalists who were beheaded.

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